Hiring the employee who is the right fit is both an art and a science. When dealing with entry level candidates who have no prior work history or demonstrated career success, it can be difficult to determine who will be a great hire and produce a positive ROI. Further complicating matters is the fact that there are drastic differences between the graduates of various financial planning programs.
Fortunately, there are things you can do to improve your chances of a good fit hire. We encourage firm owners to consider a recruiting process that assesses the core areas of a candidate’s capabilities to help alleviate the "Gotcha" and "A-Ha!" moments that are sometimes associated with new hires.
Here are some tips and techniques that we have found useful in our experience for screening candidates that you may want to follow in creating or revamping your own screening process:
- Resume Review - Set up your process so candidates have to do more than just send a resume. If you are using one of the job boards, set up an auto responder with instructions for submission to deter the serial job posters who are nothing more than time wasters. You might want the candidates to record a video of themselves telling you why they want the job through a program such as ziggeo.com. This is a good time to make sure there is a culture, philosophy, work style, and career fit. Hint: Monitor who follows directions, who does the minimum and who goes beyond the minimum. Spend your time focusing on the internships, extracurricular and leadership activities, and volunteerism sections. It should be obvious, but watch for spelling and usage/grammar errors.
- Initial Interview - Typically held via phone or video chat (Google Hangout, Skype, etc.), but could be in person as well. Spend this time getting a sense for their communication style, how they respond to questions you ask, and what questions they ask. Consider using some of the same life planning questions you ask your clients to get a sense for their commitment and passion for financial planning. Hint: Have them call you at the specified time to gauge whether they are organized and timely.
- Computer skills test - The majority of the resumes I receive specify that the candidate is "proficient" and/or an "expert" in something, usually some type of Microsoft Office Suite software. Unfortunately, even amongst these candidates, skillsets vary significantly. Delve further into how they’ve used the software in the past to determine if they are really “proficient” or “expert” at it. Hint: Make them prove it!
- Personality and/or Conative assessment – Depending on how intensive your recruiting process is, you can get a glimpse of the motivational and behavioral aspects of a candidate from your interactions with them. Use tools such as Profile XT, DISC, Strengths Finder, Kolbe, etc. to confirm or sometimes disprove them. Hint: Be careful viewing this as a Panacea. Personality profiles are best utilized within a larger comprehensive screening process. Be certain you use the personality profile fairly early on. Some firm owners have difficulty using a personality profile to screen late in the process after they’ve already made up their mind based on the rest of their interactions.
- Cognitive exercise - Just because someone graduates from a financial planning program doesn't guarantee they can answer questions at the level you are expecting. If you are hiring a new planner to answer basic client questions, you need to ensure they can do that. Compile all of the client questions you have recently received and want someone else answering then test how your candidates do with the questions. You will get a better picture if you include all technical areas of financial planning, as well as Time Value of Money. Have them write a response to a client question to gain an understanding of their thought process. Hint: Make the exercise timed, to see how the candidates manage their own time and respond under pressure.
- Financial Plan construction - The positions we recruit for are heavily involved in the planning process, therefore it is crucial that candidates understand how to gather and input data, double check their work, create specified reports, and analyze the data to answer client questions. The CFP Board did add a capstone course that now requires students to complete and present a financial plan. I have often found that this isn't enough exposure to meet firm owners' lofty expectations. Have candidates complete a plan with the software you employ, and monitor who plunges in versus who reads the manuals/watches tutorials first, etc. This gives great insight to their learning style. Hint: Send a case that closely resembles your ideal client profile.
- Late Stage Video and/or In Person interview - For the candidates that make it through to this stage, spend time discussing the weaknesses that have been uncovered throughout the process. Bring up any gut concerns you have and be prepared to discuss an offer if all goes well. Hint: Consider having multiple team members interview the candidates. This gives the candidates more exposure to other personalities in the organization, but more importantly, gives additional sources of input prior to making a hiring decision. Watch out for candidates that respond to you well, but interact with your staff poorly.
Finally, for new planners to be successful, they have to have passion for the financial planning profession. In my experience, candidates who aren't passionate about the financial planning profession rarely put in the time and effort to go through the above screening process, which actually further reduces the risk of a bad hire for the firm owner.
If this all sounds like too much work, I invite you to check out the new candidate screening solution service we recently launched http://bit.ly/NewPlnrRecScreening. We can help with your candidate screening process.
- Caleb will be attending the CFP Board Registered Program Directors Conference August 8th- 9th in Washington, DC
- Michael will be speaking at the FPA Colorado chapter meeting in Denver on August 9th
- Caleb will be presenting to FPA of Northern California in Sacramento on September 12th and 13th http://bit.ly/FPAExpo
- Be sure to find us on Twitter: Caleb @NewPlnrRec and Michael @michaelkitces. You can also “Like” us on Facebook http://bit.ly/NewPlannerRecFB
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